Taxpayers Boost Tejon Ranch To Profitable First Quarter

By Patric Hedlund

It seems that conservation pays…very well. Tejon Ranch Company (traded on the New York Stock Exchange as TRC) reports revenues from operations for the first quarter of 2011 were “above $18.6 million—more than a five-fold increase from the year before— and an increase in net income of more than $10 million.”

How’d they do that? Is this a sign that the economy is thriving again?

In February 2011 the taxpayer-funded California Wildlife Conservation Board paid $15.7 million to TRC for conservation easements that were funneled through the Tejon Ranch Conservancy.

The company reserved the right to continue farming, mining and collecting other benefits of ownership from the acreage, including favorable tax considerations and public water appropriations based upon the continuing “agricultural use” designation for those acres.

The company’s financial statement explains, “The conservation easements preclude us from pursuing any longterm real estate development on the 62,000 acres, but allow us to continue to operate current revenue generating activities including farming, cattle grazing, oil and gas, and other mineral exploration on portions of the acreage.”

Apart from the public funds for the conservation easement, TRC operations earned $6,896,000. That is $2,808,000 above the $4,088,000 reported in the first quarter of 2010.

Higher farming revenues and higher commercial/industrial segment revenues were credited for these “revenue improvements [that] were partially offset by higher operating costs,” according to the statement released by TRC.

“Common stock earned $0.44 per share, compared to a net loss of $0.08 per common share for the same period in 2010 (share references are fully diluted),” the statement says. On Tuesday, the stock that tumbled last year to about $32 closed at $36.32.

Over the past month, Tejon Mountain Village and TRC have donated to several Mountain Community charities and community initiatives that benefit children and families.

This is part of the May 13, 2011 online edition of The Mountain Enterprise.